Streamlining Mortgage Servicing for Borrowers Experiencing Payment Difficulties; Regulation X

International Bancshares Corporation, a multi-bank financial holding company, opposes the proposed amendments to Regulation X because they lack objective standards for triggering loss mitigation. The company argues that the proposal could lead to inconsistent processes, indeterminate review cycles, and operational difficulties for community and regional banks that service their own loan portfolios.

The National Consumer Law Center (NCLC) submitted an ex parte memorandum summarizing a meeting with the CFPB to discuss the proposed rule on streamlining mortgage servicing. The organization argues for specific protections for borrowers, including a reasonable diligence standard, improved notice requirements, and the inclusion of "request for information" as a trigger for protections.

The Mortgage Bankers Association (MBA) supports the proposed rule but advocates for specific modifications to ensure operational feasibility and flexibility for investors. They recommend establishing clear triggers for the loss mitigation review cycle, retaining the "one bite at the apple" standard, and limiting certain notification and fee requirements.

The American Bankers Association (ABA) opposes the majority of the proposed changes to Regulation X, arguing that many provisions—such as fee prohibitions and language access requirements—exceed the Bureau's statutory authority and impose significant operational burdens. While they support removing the anti-evasion provision to allow for sequential review, they argue the rest of the proposal is unnecessary, lacks evidence-based justification, and could create impractical foreclosure pauses.